Prudence N. Barnes, Contributor
The new Rooms - International Furniture and Accessories. - RUDOLPH BROWN/CHIEF PHOTOGRAPHER
THE PRINCIPALS in the local franchise of the United States (U.S.) furniture distribution chain, Rooms to Go, have formally severed their franchise arrangements with the U.S. company, after a five-year relationship.
From its sole Jamaican location at 92 Constant Spring Road in St. Andrew, they have rebranded their operation under the name International Furniture and Accessories in an effort to gain a stronger foothold in the local furniture industry.
The move took full effect on May 1 and comes against the background of a less than robust performance by the brand since its entry into the Jamaican sector in 2000 which saw, among other problems, the closure of its Montego Bay operations.
General Manager of International Furniture and Accessories, Louis Spence, told the Financial Gleaner that the re-branding of the local furniture retail outlet is a push to increase competitiveness by having the flexibility to source a wider range of high quality furniture and home accessories from various parts of the world with the ultimate aim of reducing prices to their clientele.
Spence has calculated that as a result of the new thrust, customers of International Furniture and Accessories can immediately expect to see a 25 to 30 per cent reduction in the price of items, with a wider variety of high quality goods to choose from.
"In seeking to position ourselves in the market, we did quite a number of unofficial surveys to determine the response of the public in general, and that market niche to which we would have wanted to attach ourselves," he said.
"What came out of it was ... that Rooms to Go has wonderful furnishings, but that the price is so exorbitant that I just don't go there," Spence revealed. He added that in order to cement itself in the marketplace, the company had to surmount that hump by taking a serious look at its operations.
Part of the drawback with Rooms was that the franchise agreement with the US furniture chain Rooms to Go only allowed for goods supplied or certified by them to be stocked, and the prices were not always competitive.
Since its establishment in Jamaica, Rooms to Go has been marketed as a middle to upper-income brand with an assumption that most persons in that income bracket can make cash purchases, so little attention was paid to facilitating financing. International Furniture and Accessories has reviewed its marketing strategy, and has begun to work more closely with financial institutions to provide financing to those potential customers with discerning tastes who seek the company's offerings.
With the ending of the relationship with Rooms to Go, International Furniture and Accessories now has total freedom, Spence said, to search for high quality items from around the world and bring them to its clients, adding that the company has its eyes set on greater exploration in Europe, the Far East, South America and from Jamaican artisans. "So we are cutting out the middle man, and going around the world and bringing quality furnishings directly to our customers."
The advent of the US furniture distributor, "Rooms to Go" was in train since the late 90s. Officials from Rooms to Go, USA, approached a group of Caribbean investors about the possibility of establishing franchises in the region, as the furniture chain sought to extend its reach to the Caribbean. The end result was the establishment of franchise operations in the Cayman Islands, the US Virgin Islands and Jamaica. But the Caribbean has not responded well to the US brand.
Ironshore, Montego Bay was selected as the launching pad for the Jamaican operation, but after two years of good performance, according to Mr. Spence, that operation began to decline due to a general downturn in the Montego Bay economy resulting in the ultimate closure of that store in 2003. The Kingston store was established in that same year.
"(In Montego Bay) we saw as a business where we started to do badly. At that time we had already taken the decision to come to Kingston," he added.
Mr. Spence said that the franchises in the other Caribbean islands have also experienced difficulties due to the same factors of pricing which have plagued the Jamaican operation, and they too are going through re-branding under the International Furniture and Accessories banner.
He emphasised that the severance of the relationship with Rooms to Go in the USA, was an amicable one as that company looked at the performance and understood the situation.
International Furniture and Accessories acquired the remaining Rooms to Go items it had in stock, and just recently concluded and liquidation sale, Mr. Spence noted, adding that the remaining items will be re-priced along with new stock. International Furniture and Accessories will also continue to purchase some select items from Rooms To Go, Mr. Spence said.
While not giving details on any financial losses which may have been suffered, Mr. Spence stated that the company is now in a recovery mode.
